Market shocks should be wake-up call for investors: Advisors

A period of very calm and quiet trading has lulled investors into a sense of complacency that, by some measures, has not been seen in years, according to some financial advisors.

The recent sharp movements in markets have been a wake-up call for complacent investors, experts say. From February 2016-January 2018, volatility in the stock market was non-existent. Then, volatility came roaring back in February, as investors aggressively sold stocks after an incredible run. And now, some investors are concerned that the recent sell-off on Wall Street might get much worse and eventually that could trigger a recession.

While many financial experts believe the current sell-off in the global markets is a “minor correction,” some pundits see the increased possibility of another recession in the United States.

Billionaire investor Ray Dalio thinks there is a relatively high chance the U.S. economy will stumble into a recession before the next presidential election, in 2020.

Dalio, chairman of Bridgewater Associates, said the U.S. economy is not currently in a bubble, but he said it might not take long to get there and then to move on to a “bust” phase.

He made his comments during an appearance at the Harvard Kennedy School’s Institute of Politics.

We spoke with several members of the CNBC Digital Financial Advisor Council to weigh in on the current market conditions and the possibility of a recession.

“I really feel strongly that we’re not going to see a recession until at least a year, year and a half — maybe even longer,” said Cathy Curtis, founder and owner of Curtis Financial Planning. The U.S. and global growth are strong right now and could even be stronger next year, she added.

“So, to me, this year may again be another positive year for stocks,” Curtis said.